Brexit, Trump and so much more, it seems that everyday is a rollercoaster on the exchange rate front. With so much uncertainty there is always a temptation to wait things out until calmness prevails, see what things will look like after Brexit or once Trump losses control of the house of representatives.
Our years of experience tell us that is hard to pick. And what’s more that the markets seem to react in very short cycles in this day and age, rather than the long cycles of past. Just look at what has happened to the NZD-UK exchange rate in the last three months, it makes yo-yos dizzy.
It is an almost 10% movement, so on a £100,000 pension fund you could have had a New Zealand dollar equivalent of between $186,000 and $204,000. That difference could buy a reasonable car.
All things being equal, having your UK pension in New Zealand gives you greater exchange rate control, as plenty of New Zealand QROPS have GBP denominated funds. This means that if the exchange rate hits a point that you are comfortable with you can switch your investments from GBP to NZD and cash in on it.